Oil prices hit five-month low

Thursday 10 January 2008 00:09 BST

Oil prices have slid to their lowest levels since April amid signs that production cartel Opec was planning to keep supply levels steady.

Opec members including Saudi Arabia and Iran are holding their regular six-monthly meeting in Vienna, with analysts expecting the organisation to maintain a production target of 29.673 million barrels per day.

October Brent crude fell by 4.14 US dollars to 99.30 US dollars a barrel on London's ICE commodities exchange, slipping below 100 US dollars for the first time since the beginning of April.

Light, sweet crude traded on New York Mercantile Exchange - the world's benchmark crude price - also dropped to a level not seen since April, falling by more than three US dollars a barrel to settle at 103.26 US dollars.

Saudi Arabia, which accounts for around a third of Opec output, signalled before the meeting that it was happy with the current oil situation.

Oil minister Ali Naimi told reporters in Vienna: "The market is fairly well balanced. I think things are in balance, in a healthy position."

Oil prices have fallen nearly 30% from the 147 US dollar high seen in July as projections of slower global economic growth have dampened demand.

Petrol prices on UK forecourts have not fallen as quickly, with average unleaded petrol down from July's peak of 119.7p to 112.7p at the weekend - a drop of nearly 6%. Average diesel prices have fallen from 133.3p to 124.1p, just under 7%.

The AA said it takes around four to six weeks for oil price changes to filter through to forecourt pumps.